Untitled Texas Attorney General Opinion

The Attorney General of Texas Feb:mary18. 1986 JIM MATTOX Attorney General Suprms Court Buildin Mr. ClaytonT. Garrisou OpinionNo. 34-427 P. 0. BOX 12549 ExecutiveDirector Austin, TX. 78711. 2549 EmployeesRetirementSystem Rc: Whether the par diem limita- 512/4752501 of Texas tions of section 4 of article Telex 910/874-1357 Telecopier 51214750268 P. 0. Box 13207 of the General AppropriationsAct Austin,Texas 787!1 apply to members of the Board Trusteesof the EmployeesRetire- 144 Jackson. SUitS 7M) ment Systsm Daiim.. TX. 752924509 214i742.Ba4 Dear Mr. Garrison: 4B24 Albda Ave., Suite 180 You ask vhethe:r the limitationscontainedin section4 of article El Paso, TX. 799052793 V of the current GtcneralAppropriationsAct, Acts 1985, 69th Leg., 91515333494 ch. 980, at 7761, apply to members of the Board of Trustees of the Employees.,Retirement:Spstsm of Texas. 11 Texas. Sulls 799 .. ..suston. TX. 77002-3111 In general. mambers of-the state boards and coamissious ire 7131223-5886 entitled to per dim pursuant to article6813f. V.T.C.S.,in coajunc- tion,with the General AppropriationsAct. See Attorney General Opinions JM-382 (1985); JM-152 (1984);Mu-388 (1981). Section 4 898 Broadway. Suite 312 Lubbock. TX. 794013479 articleV of the currentact provides: SW74?-522.9 PER DIW OF BOARD OR COMMISSIONMWBRRS. As authorirmlby Section 2 of Article 6813f. Texas 4309 N. Tenth, Suite B McAllen. TX. 78501-1085 Revised Xvi1 StatutesAnnotated.the per diem of 5121082.4547 state board and com&sslon members shall consist of (1) tlm amountsof compensatoryper diem at $30 per day; (2) actual expensesfor meals and lodging 200Maill Plaza.suite 400 a s luth+zed by this Act not to exceed the San Antonio, l-X. 78205-2797 512/2254191 maximum amouat allowed as a deduction for state legislatwts while avay from home during a legislative session as established pursuant to the Intemal Reveuue Code 26 U.S.C. Section 162(l)(l)(B)(ii); and (3) trausportatiou.In the event the maximum amount allowed as a deduction for staee legislatorspursuant to the Interual Revenue Code as provided above is raised to au emount above $100, the maximum -ut of the meals sad lod$;lng portion of the per diem paid to board and cormpilsslonmembers under this section shall not exceed $100. (Emphasisadded). p. 1957 . I Mr. ClaytonT. Garrison- I'age2 (JM-427) The first paragraph01'articleV providesthat [tlhe provisions:setforth in this and all other Articlesof this A.ctare limitatiousou the appro- priationsmade irtthis Act. It is the purpose of the Legislature :ia euacting this bill only to appropriatefundo and to restrictand limit by its provisionsthe amount and conditionsunder which the appropriaticnscan be expended. (Emphasis added). This provisionreflects tk,econstitutionalprinciple that appropria- tion bills shoulddeal only with appropriations of funds; a rider to a general appropriationsbill caunot amend, modify, or repeal general lav. See Tex. Coast. art. 1.11,635; Moore v. Sheppard,192 S.W.2d 550 (Tsx.1946); Coates v. W:~~I. 613 S.W.2d 572 (Tex. Civ. App. - Austin 1981, 110Vrit). In light of these prov~isious , and assumingwithout decidingthat the board is a "stateboard"within article6813f and articleV of the AppropriationsAct, you sugtgestthat section4 of article V does not apply to the board membew because the funds from which the board memhers' expenses are psid are not properly deamed "appropriated" funds Within the meaningojiarticleV. We .agreewith your coaclusioa. It has been suggestedthat, regardlessof whether the article V limit applies directly tc these funds. the measure establishedin articleV applies to the funds. Section25.208 of Title 1lOB provides in subsection(a), as follows: The board oji trustees shall compensate all persons whom it maploys and shall pay all expenses necessaryto operate the retirementsystemat rates and in amountsapprovedby the board. Those rates and amouutsmay sot exceed those paid for the same or similarserrria-! for the state. (Emphasisadded). This provision appeara;to apply.to "all expenses necessary to operate the retirement system." Expenses necessary to operate the retiremeutsystem arguablyriaclude per diem for board members. Thus, this section appears to limit the board to the article V limit applicableto other state b'oardmembers. Section 25.208, houwer, IS in SubchapterC of Chapter 25 of Title 1lOB. This subchapter,by its title, deals with "Officer!% and Employeesof [the]Board of Trustees." In contrast,SubchapterA of chapter25 deals with the "Board of Trustees." Section 25.006 of Subchapter A authorizes certain trustaes, subject to appwval by tha whole Board of Trustees, to receive compensationand all expensesnecessaryto the performanceof their officialduties: P. 1958 Mr. ClaytonT. Gerrisoa- P,kge3 (a-427) (a) Ttusteeswho are coatributiagmembers of the retirameat s:rstemserve without compensation but are entitledto reimbursementfor all aeces- sery expensesthM they incur in the performeace of officlalboard (duties. (b) Subject t:athe approval of the board of trustees, truste!sswho are not contributing members of the retirementsystemmey receive: (1) compenaatioa; and (2) all nc:cessaryexpenses that they incur in the perforsanceof officialboard duties. Thus, if both section 25.006 and section 25.208 were to apply to trustees, they would be in conflict. We do not believe that the legislatureintendedthis result. Moreover, when the legislaturehas limited or provided for something in one section of a statute and excludedit in another,it should not be impliedwhere excluded. See generally Smith v. Baldwia.~611 S.W.2d 611,616 (Tex. 1980). BecaK the limit la section 25.208 does not appear in section 25.006, to imply such a limit would u,lolatethfs well-settledrule of statutory . construction.: :'. The per diem authorizei. by section25.006 of Title llOB, V.T.C.S., for board members is to be paid out of the "expense account"created by section25.311 of Title 1lOB: (a) The retiremeateystem mbell deposit in the expeaseaccountmrtzmbershipfees, maey requiredto be treaeferredto the accountuader Sectioa25.314 of this subtitle,ead any apprwrlatioae ude be the legisleture121the eccouat. (b) The retir~aasnt system shall uay from the expanse account-admiaistratioacad meiatenaace expenses of the-retirement systsm except those expenses the vay;eat of which is provided for by Se&m 25.2Oi(c)or 25.313(b) of-this subtitle; (Pophasisadded); Tbe sectioa 25.311 aarpeaselccouat coaeiste of 1) membership fees, 2) money transferred,, pursuant to section 25.314(b).from the interest account, which c'xlsists of earnings from the iavestmentof the aseats of the Employetrs RetirementSystem. ead 3) eay appropria- tioas mede by the legislatureto the account. Tbe interest account includes earnings from inrestmeat of the system's assets. 125.310. The assets of the systemincludeboth employeeend state coutributions p. 1959 Mr. ClaytonT. Garrison- Pnjsa4 (JM-427) to the system. See S525.Nll - 25.403. You suggest that the funds administeredby G board,,includingthis expense'account,are not properly deemed "appropria!:edfunds"vithin the meaning of article V because they ara trwt funds. Bacausa the portion of the account which consists of membershipfees and earnings on the iavestmentof employee contributionsis wra than sufficientto cover the per diem expanse in question,ve need not decide vhether all of the funds in this expense account are "expropriatedfunds" within the maanlng of articleV. In Attorney General Opinion WW-565 (19591, this office decided that certain funds adminiszaredby the Employees Retirement System "may be expended. . . in accordancewith the general statutesper- taining to the [system]vjthout prior specific appropriat%onsby the Legislature." See also Attorney General Opinions m-276 (1980); H-681 (1975); M-949 (1971). Attorney General Opinion VW-565 con- sidered the scope of article VIII, section 6 of the Texas Constitu- tion, a provision vhich prohibits the vithdraval of funds from the state treasuryvithout a specificappropriation.Relying on Friedman vi American Surety Compaq of Nev York, 151 S.W.2d 570. 579 (Tex. 1941). the opinion concluded that funds received by the Employees RetirementSystem from menberahipfees and earnings from the invest- ment of the system’s assets fall within an exceptionto these con- . stitutionalprovisionsas "ttist"fun&. .. The funds providedfo::in the EmployeesRetirementSystem Act, in effect when Attorney Gewral Opinion WW-565 vas decided, vera collectedunder statutoryj?r:ovisions which set the funds apart for the specificpurposes for vhicb they vere collected;they could be used for no other purposas. The opinionreasonedthat the funds became the propertyof a public trust createdfor the benefitof the employeesof the state - not the propextyof the state in its sovereigncapacity. See generallyFriedmanv. American Surety Company of Nev Pork, m Because the act governin(~the system did not contemplatethat the funds vere to be deposited:Lnthe-statetreasury &,-in the general revenue fund, but rather in a special trust fund held separatelyin the state treasury. the constitutionalrequirementfor a specific ;;~f~~lation for upendirurea did not apply. After this opinionwas language vaa a,doptedin the Texas Constitution which clariflidthat "[tlhe asae:ta of a [publicretirement]system are held in trust for the benefit of &are and may not be diverted." Tu. Conat. art. XVI, 567(a) (1). We are avare that thl:Texas courts have held that an employee's interestin such trust funds is subject to the right of the leglsla- tura to amend the lavs on which the pensionsystems are founded. See. a, City of Dallas v. T:~uawll,101 S.W.2d-1009.1013 (Tea. 1937); Lack v. Lack, 584 S.W.2d &96,- (Tax. Civ. bpp. - Dallas 1979. vrit ref'd n.r.e.); Cook v.~ @ployees Retirement System of Texas, 514 S.W.Zd 329. 331 (Tex. Civ, App. - Texarkana1974. vrit ref'd n.r.e.1. p. 1960 Mr. ClaytonT. Garrison- Page 5 (J&427) These cases,however. did not address articlaXVI. section 67, of the Texas Constitution,vhich n'asadoptedby specialelectionin 1975. As indicatad,subsection(a)(l)of section67 providesthat "[tlhe assets of a system are held in trust for the benefit of members and may not be diverted." It is unnecessaryto delve into this issue at this time. because we do not address the right of an employee to trust funds in a retirementsystem;we address only the scope of the term "appropriatedfunds" under'article V of the currant Appropriations Act. Applying the rationale,of Opinion WI-565 to the case at hand compels the conclusion that, because a general appropriation is unnecessary for the axpendi.tureof these funds,limitationson general appropriationsare inappli~ablato these constitutionaltrust funds. Accordingly,va concludethat the expense fund establishedby section 25.311, from vhlch the members of the board of trusteesare to be paid any per diem properly duo under Title llOB, is composed of trust funds,not "appropriatedfunds"within the meaning of articleV of the current General AppropriatLms Act to the extent that it consistsof membership fees and interczston amployee contributions. Thus, the limitationscontainedin s'wtion4 of articleV of the currentAppro- priationsAct do not apply t:othe expenditureof such funds. SUUMARY . The portion of the expense fund establishedby section 25.311 of Title 1lOB. from which the members of the B'xrrdof Trustees of the Employees RetirementSystaa of Texas are to be paid any par diem properlydua them, is composedof funds held in trust for the employees of the state to the extent that it consists of membarehip fees and interest on emILoyees' contributiona. Because these are trust funds, rather than "appropriated funds" within thlcmeaning of article V of the current General AppropriationsAct, the limita- tions contained. to section4 of articleV do not apply to the per diem vhich may be due a board member. -$..m/#(& MATTOX AttorneyGeneralof Texas JACK HIGBTObER First AssistantAttorneyG,aneral p. 1961 Mr. ClaytonT. Garrison- Page 6 (JM-427) MART KELLER ExecutiveAssistantAttorneyGeneral ROBERT GRAT SpecialAasistantAttorneyGeneral RICK GILPIN Chairman,OpinionCosuaittee! Preparedby JenniferRiggs AssistantAttorneyGeneral p. 1962